For at least a decade, Senator McCain has enthusiastically and consistently supported the privatization of Social Security. As this diary explains, McCain has demonstrated his support for the privatization of Social Security with his votes, speeches and other public statements, in TV and newspaper interviews, through his campaign literature, and the comments of his advisors. He has a long history of supporting this very bad idea!
In the wake of both Congress's rejection of Bush's 2005 privatization proposal and the recent stock market downturn, McCain may try to to run away from his record on this issue, but we can't let him get away with it. Try as he may, McCain cannot run from his clear track record on the issue.
Please note that I have included endnotes at the end of my diary identifying the sources which substantiate each of the specific claims I make in this diary. Please feel free to share this material with anyone you know who is considering supporting McCain and may be unaware of his record on this important issue.
McCain’s 10 year history of supporting the privatization of Social Security
For at least a decade, Senator McCain has enthusiastically and consistently supported the diversion of a portion of Social Security payroll taxes into risky private investment accounts, that is to say, the privatization of Social Security. As this e-mail details, McCain has demonstrated his support for the privatization of Social Security with his votes, speeches and other public statements, in TV and newspaper interviews, through the statements of his advisors, and in his campaign literature. Try as he may, McCain cannot run from his clear track record on the issue.
In 1998, McCain twice voted in favor of privatizing Social Security
On April 1, 1998, McCain voted for an amendment to express the sense of the Senate that “the Committee on Finance shall consider and report a legislative proposal this year that would dedicate the Federal budget surplus to the establishment of a program of private Social Security retirement accounts.”1
The following day, on April 2, 1998, McCain voted to “use any of the budget surplus” that existed at the time during the Clinton years in part “to establish private Social Security retirement accounts.”2
McCain called for Privatization of Social Security in 1999, and during his 2000 presidential campaign
The right wing advocacy organization, the Club for Growth, which supports Social Security private accounts, has noted that “Senator McCain has also been a consistent supporter of [private] Social Security accounts, calling for "bold, genuine reform that allows workers to invest some of their Social Security savings, privately, in higher yielding accounts" in a 1999 press release.”3
The Club for Growth has also noted that “[d]uring his 2000 presidential campaign, Senator McCain's plan for Social Security reform included a pledge to incorporate [private] retirement accounts within his first year in office. . .”4
On June 2, 1999, McCain gave a speech in Sun City during which he asserted that “My friends, there is only one solution if Social Security commitments are to be honored without breaking the backs of the next generation: bold reform, genuine reform that allows workers to invest some of their social security savings, privately, in higher yielding accounts.” 5
During that speech, he also stated that “The only way to increase the yield of Social Security dollars is by allowing workers to make investment decisions for themselves; by empowering American families to invest, in more robust portfolios, a portion of their earnings for social security that they would otherwise pay in taxes to Social Security.”5
On June 7, 1999, McCain gave a speech in which he again stated that “"My friends, there is only one solution if Social Security commitments are to be honored without breaking the backs of the next generation: bold reform -- genuine reform -- that allows workers to invest some of their Social Security savings, privately.”6
In December 1999, during an appearance on Fox News Sunday, McCain came out in favor of private Social Security accounts. 7
When Mara Liasson of Fox News asked McCain “if you let people take the payroll taxes and put them into private retirement accounts, what happens when the market goes down and they're left without Social Security benefits?,” McCain rejected the concern that a stock market downturn could destroy the value of a future retiree's private account if Social Security were privatized. 7 The relevant exchange was as follows:
LIASSON: And if you let people take the payroll taxes and put them into private retirement accounts, what happens when the market goes down and they're left without Social Security benefits?
MCCAIN: Well, since 1945 the stock market has had an average return of 5.5 percent. The return on Treasury bills is three percent. That's an average since 1945. And I don't think that this economy is going to meet although I'm very optimistic about it. But I'm confident that our last 45 -- nearly 50 years of experience will hold.7
When McCain ran for president in 2000, his campaign put out a Question & Answer statement which stated that “I support allowing workers to privately invest a portion of the dollars they would otherwise pay to the government in payroll taxes.”8
The Wall Street Journal recently noted that “[a] centerpiece of a McCain presidential bid in 2000 was a plan to divert a portion of Social Security payroll taxes to fund private accounts, much as President Bush proposed unsuccessfully. Under the plan, workers could manage the money in stocks and bonds themselves to build a nest egg and, at retirement, also receive reduced Social Security payments from the government.”9
In 2004, McCain Publicly supported Privatization of Social Security
On November 18, 2004, McCain was asked at a town hall: “Will privatizing Social Security be a priority for you going forward?” McCain responded “Without privatization, I don’t see how you can possibly, over time, make sure that young people will continue to receive Social Security benefits.”10
During the debate over Bush’s Privatization Proposal in 2005, McCain was a public supporter of Bush’s proposal to partially privatize Social Security
During the battle over Bush’s social security privatization proposal in 2005, McCain was a vocal public supporter of the privatization proposal:
For example, during an appearance on CBS’s “Face the Nation” on January 23, 2005, McCain acknowledged that he was “a supporter of a supporter of the president's plan to overhaul Social Security, including the centerpiece of that, which is letting people put part of their payroll taxes into personal, private accounts.” 11
In response to a question on that show, Senator McCain stated that he “didn't get the impression that it was a dead horse on Capitol Hill.” 11 McCain also indicated that he might support a “rise in the payroll taxes to finance the president's plan on Social Security.”11
On February 2, 2005, during appearance on Hardball with Chris Matthews, McCain stated that “I believe in a private savings account.”12
On February 6, 2005, McCain appeared on Meet the Press. When George Stephanopoulos asked him whether he would support Bush’s privatization plan, he said “I haven't seen the specific outlines, but I'm certainly with him in principle.”13
On February 27, 2005, during an appearance on Fox News Sunday with Chris Wallace, McCain stated that he thought that President Bush had “made the case” for private Social Security accounts. He also stated that he hoped that president Bush would NOT have to scale back on his Social Security proposals. In addition, he referred to private accounts as a “fundamental issue” which was “good thing to do” and “an important thing that we should continue to support.”14
Here was the exact exchange:
WALLACE: What are you hearing from your constituents about Social Security reform? Has the president made his case for personal accounts, both the cost and the risk?
MCCAIN: I think he's made the case. I think my constituents want us to sit down together and stop demagoguing the issue. I think that the Democrats owe it to us to stop demagoguing and sit down and seriously negotiate.
There's not going to be the same benefits 30 years from now or 20 years from now for working Americans, and we better sit down and work together and come to an agreement.
WALLACE: Now, there are some reports today that congressional Republicans who were home for the recess now, having heard from their constituents, feel that the president may have to scale back on his Social Security reforms. Are we at that point?
MCCAIN: Well, I hope not. I think the president has indicated that he would be flexible. But the fundamental issue of personal savings account - look, that renowned conservative country Sweden has a personal savings account. So does Chile.
Look, this is a way - this is what our grandfathers would have advised us to do, try to take some of our money and invest it ourselves, not in something like Enron but in, like we do with federal employees and members of Congress, in one of five different groups.
It's a good thing to do. Interest compounds. And I think it's an important thing that we should continue to support.14
In March 2005, McCain voted AGAINST a sense of the Senate resolution “to express the sense of the Senate that Congress should reject any Social Security plan that requires deep benefit cuts or a massive increase in debt." 15 The resolution was a response to growing concerns about the deficits and benefit cuts that would result from Bush’s Social Security privatization proposal.15
In 2007 and 2008, McCain continued to publicly support privatization and said that it’s “an absolute disgrace” that the Social Security system is funded from the taxes of young workers
For example, during an October 2007 debate between the Republican candidates for president, McCain stated that “We need personal savings accounts.”16
During a Denver town hall on July 7, 2008, McCain stated that the fact that “we are paying [Social Security benefits to] present day retirees with the taxes paid by young workers in America today” is “an absolute disgrace.”17
During a town hall meeting in Osh Kosh, Wisconsin on February 15, 2008, McCain said “I would like to applaud the President’s efforts after the 2004 election to try to get the Social Security… uh… fixed.”18
In an interview with the Wall Street Journal which was published on March 3, 2008, McCain told the newspaper that “he still backs a system of private retirement accounts that President Bush pushed unsuccessfully, and disowned details of a Social Security proposal on his campaign Web site.”19
McCain told the Wall Street Journal that "I'm totally in favor of personal savings accounts." When he was reminded that his Web site said something different, he says he will change the Web site. He also told the Wall Street Journal that "[a]s part of Social Security reform, I believe that private savings accounts are a part of it -- along the lines that President Bush proposed."19
During an AARP sponsored discussion on July 14, 2008, one of McCain's top economics advisers, Douglas Holtz-Eakin, acknowledged that “He liked personal [i.e., private] accounts, which President Bush proposed”20
Even after the financial crisis in September 2008, the Republican presidential nominee was continuing to tell reporters that private retirement accounts like those President Bush pushed in 2005 but abandoned in the face of congressional opposition should still be considered. 21 The aides tried to soothe voters concerned about the bankruptcies, takeovers and bailouts on Wall Street by declaring McCain favored only the option of such accounts, just for younger workers, and most likely in a conservative investment vehicle such as bonds.21
Sources:
1 See Roll Call on Senate Vote #56 (April 1,1998), available at http://www.senate.gov/...
2 See Roll Call on Senate Vote #77 (April 2,1998), available at http://www.senate.gov/...
3 See Website of Club for Growth, at http://www.clubforgrowth.org/...
(citing fn 45 McCain campaign Press release, 06/02/99)
4 See Website of Club for Growth, at http://www.clubforgrowth.org/...
(citing Fn 46, a Cato Institute Newsletter, 01/10/00)
5 See McCain speech on Social Security, 06/02/1999 in Sun City, AZ, available at http://www.votesmart.org/...
6 See http://www.socialsecurity.org/...
7 See CATO Institute’s website, available at http://www.socialsecurity.org/...
8 See http://www.votesmart.org/...
9 See Wall Street Journal, March 3, 2008 article,
Available at http://online.wsj.com/...
10 See video clip available at http://www.youtube.com/...
and see video clip available at http://www.youtube.com/...
11 See CBS Face the Nation-Transcript Date: 01/23/2005, available at http://votesmart.org/...
12 See MSNBC Hardball With Chris Matthews – Transcript, Date: 02/02/2005, available at http://votesmart.org/...
13 See ABC This Week-Transcript (02/06/2005), available at http://votesmart.org/...
14 See FNC Fox News Sunday – Transcript (02/27/2005), available at http://votesmart.org/...
15 See Roll Call for vote #49, available at http://www.senate.gov/...
and
see New York Times article (dated March 16, 2005), available at http://www.nytimes.com/...
16 See transcript of Republican Debate which was held in Orlando, Florida and was broadcast on Fox News on October 21, 2007, available at http://www.cfr.org/...
See also transcript of Republican Debate on Fox News Channel, available at http://www.nytimes.com/...
17 See video clip available at
http://www.youtube.com/...
18 See Video clip of John McCain at Town Hall in Osh Kosh, WI 02/15/08, available at
http://www.youtube.com/...
19 See Wall Street Journal article dated March 3, 2008, available at http://online.wsj.com/...
20 See Transcript of AARP Solutions Forum (dated July 14, 2008) available at http://assets.aarp.org/...
and see http://www.swamppolitics.com/...
21 See Chicago Tribune, The Swamp (September 20, 2008), available at http://www.swamppolitics.com/...